B200.F09.W02.Clsnts

B200.F09.W02.Clsnts - BUAD 200 Fall 2009 Week 02: Aug. 31...

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BUAD 200 Fall 2009 Week 02: Aug. 31 – Sept. 2, 2009 Classnotes Review: 1. Defined Goods, Resources; Scarcity 2. Assumptions: A. Unlimited wants B. Limited Resources (Land, Labor, Capital) C. Scarcity 2. Derived Implications of Scarcity: A. Choice B. Opportunity cost (compared economic cost & accounting cost; defined sunk cost) C. Competition 3. Forms of Competition: A. Violence or Threat of Violence B. Social/Political C. Economic/Market 4. Evaluate fairness: Life is NOT FAIR !! Get over It !! NEW: Chapter 1: Ten Principles of Economics Individual Decision Making: 1. People face tradeoffs: First implication of Scarcity is Choice. 2. Opportunity Cost: What you give up is the cost of what you get. 3. Rational People think at the margins: We all make small decisions, we live one step at a time. 4. People respond to incentives: How people interact: 5. Trade can make everyone better off: Because we differ in our relative abilities, when we specialize and exchange, both parties are made better off. (Domestic, foreign trade) 6. The market system is a form of exchange that organizes production efficiently… 7. Market outcomes can sometimes be improved upon by government intervention. The Economy as a Whole:
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This note was uploaded on 11/07/2009 for the course BUAD 200x at USC.

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B200.F09.W02.Clsnts - BUAD 200 Fall 2009 Week 02: Aug. 31...

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